Describe the sources of supply and demand in the market for loanable funds and t

Question

Describe the sources of supply and demand in the market for loanable funds and the market for foreign-currency exchange 48. In the model of the open economy just developed, two markets determine one price and the value of three variables. What are the markets? What three variables are determined? What price is determined? 49. 50. Describe supply and demand in the market for loanable funds and the market for foreign- currency exchange. How are these markets linked How would a fall in U.S. interest rates affect Canadian investment, saving, and net capital outflow, and the Canadian real exchange rate? 51.

Explanation / Answer

As per Chegg policy, first question is answered below.

48.

In the market for loanable funds, The sources of demand is the sum of national domestic investment and the supply is National saving.

In the market for foreign-currency exchange - The sources of demand is exports and the sources of supply is imports

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